View all Articles
Commentary By Robert VerBruggen

Free Money, Less Income: Study Finds No-Strings Cash Leaves the Poor Worse Off

Economics Tax & Budget

What happens when you give people free money with no strings attached?

The question is of enormous importance to America’s safety-net policy, given widespread proposals for a “universal basic income” or a “child allowance”— which would give unconditional cash payments to all adults or all parents.

A massive scientific experiment has now provided the most compelling answers to date.

Those answers pretty much align with common sense: When people get free money, they work a bit less and play a bit more.  

And while they spend more on health care, they don’t see enduring health improvements as a result.

This study won’t end the movement for no-strings cash, of course, but it certainly validates some common criticisms of these policies.The experiment included 3,000 lower-income Americans aged 21 to 40, drawn from 19 counties in the Dallas and Chicago areas, with an average household income of just under $30,000.

Continue reading the entire piece here at the New York Post

______________________

Robert VerBruggen is a fellow at the Manhattan Institute. Follow him on Twitter here. Adapted from City Journal online.

Photo by alfexe/Getty Images